Since the Reform and Opening up, China has made remarkable achievements on economic development, while at the same time, the imbalance and inadequacies between urban development and rural development are becoming increasingly significant, which has restricted people from stepping forward to a better life. From the perspective of the flow of urban and rural factors, based on theoretical analysis of the influence of the tertiary industry development on the urban-rural disparities and through the index analysis of the disparities, this paper finds that the disparities has certain regional dependence. Using SARAR spatial econometric models, based on an empirical analysis of the influence and the spillover effects of the tertiary industry development on the urban-rural disparities, the paper shows that the tertiary industry development has positive effects on the urban-rural disparities of both the local areas and other areas. In order to alleviate the current principal contradiction faced by Chinese society and fulfill people’s desire for a better life, we should pay more attention to promote the development of rural area.

Keywords: The Tertiary Industry, The Urban-rural Disparities, Spatial Econometric Models.